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County Leaders React to Critical State Audit Report

By Joyce Kryszak

Buffalo, NY – State Comptroller Alan Hevesi is calling for a control board to get Erie County out of a $118 million budget hole. Without action, he projects that number will soar to $279 million dollars by the year 2010.

Hevesi says colossal mismanagement is to blame for the deficit -- not Medicaid. And he says it's time to call someone in to fix it.

"I think the politics are so toxic, I think the relationships are so awful, I think there is so much mistrust, a lot of it legitimate, I think there is such a level of deception that we have to bring in adult supervision," said Hevesi.

Hevesi cited phoney numbers from the County Executive's office, fiscal gimmicks, tax cuts and one-shots. He says the legislature shares the blame for rubber stamping the budgets. The news traveled fast. Fitch's Ratings already downgraded the county's bond rating yesterday by one notch. Any lower and County Comptroller Nancy Naples says borrowing may not even be possible.

"If we're suspended, or graded below investment grade, it may be impossible. Then, we'll have to turn to the state for help," said Naples.

Naples recommends quick action, including a request from the state for approval of a 130 million dollar deficit bond, and permission to raise the sales tax by a quarter percent to pay for it over ten years. County Executive Joel Giambra and lawmakers met late Monday to gauge the body's willingness to vote on a plan. Democratic Majority Leader Lynn Marinelli was cautiously optimistic.

"I think the plans mirror the options we've been talking about. But before we get into specifics here, we owe those conversations to our colleagues who weren't here," said Marinelli.

But at least one anti-tax hike lawmaker wasn't budging from his position - even after hearing Hevesi's recommendations. Doctor Barry Weinstein says he appreciates Hevesi's findings -- but nothing has changed.

"We knew we had a deficit," said Weinstein. "Exposing the cover-up has not persuaded me to vote for a tax hike at this time."

Hevesi says if lawmakers fail to act before the state Legislature recesses on June 23rd, Erie County faces near certain bankruptcy. He says that would definitely trigger a control board that he says would probably never entirely go away.